Democratic Senator Elizabeth Warren and Republican Senator Josh Hawley have jointly called on the U.S. Energy Information Administration (EIA) to improve transparency around the electricity consumption of data centers. In a letter sent to the agency on Thursday morning, the two lawmakers urged the EIA to begin publicly collecting "comprehensive, annual energy-use disclosures" from data centers nationwide. They emphasized that such data is critical for accurate planning of the electrical grid and for shaping policies that prevent large data center operators from driving up electricity costs for American consumers.
Data centers, which house the servers and infrastructure powering much of the internet and cloud computing, have rapidly expanded across the United States in recent years. This growth has raised concerns among voters about the impact of these facilities' substantial energy demands on local electricity prices. In states with a high concentration of data centers, such as Virginia and Georgia, these worries have influenced recent elections. Reflecting these concerns, Senator Hawley recently cosponsored legislation with Democratic Senator Richard Blumenthal that would require data centers to generate their own power independently, rather than relying on the grid, as a measure to shield consumers from rising costs.
Earlier this month, former President Donald Trump hosted executives from major technology companies at the White House, where they signed a nonbinding pledge agreeing to pay for the electricity used by their data centers. However, critics describe this agreement as largely symbolic and lacking enforceability. Experts argue that without solid data on actual energy consumption, it is difficult to assess whether such voluntary commitments will be honored or whether consumers will ultimately bear the costs.
Ari Peskoe, director of Harvard Law School's Environmental and Energy Law Program, highlights the importance of accurate data. He explains that knowing exactly how much electricity data centers use is a necessary part of determining their impact on energy rates paid by consumers. While this information alone does not provide the complete picture, it is a crucial piece of understanding and managing energy demand.
Despite widespread media coverage warning of surging energy use by data centers in the coming years, obtaining concrete, official statistics on their current or projected electricity consumption is surprisingly challenging. No federal agency currently tracks energy use specifically for data centers. Companies often treat details about their electricity and water usage as proprietary business information and only disclose it voluntarily. Additionally, many data centers are increasingly installing their own power generation facilities on-site-known as behind-the-meter power-which further complicates efforts to gauge total energy consumption because this power use is not always reported to utilities or government agencies.
Utilities, which supply electricity to data centers, do have access to some energy usage data for facilities in their service areas. They use this information to forecast demand growth. However, experts caution that data centers frequently negotiate with multiple utilities to secure the best terms, leading to inflated demand projections. This can result in utilities double-counting potential future data center projects, creating "phantom" growth estimates that overstate actual electricity needs. For example, the CEO of Vistra, a retail electricity provider, stated during a 2022 earnings call that utilities may be overestimating electricity demand by a factor of three to five times compared to what is truly required.
In December 2023, EIA Administrator Tristan Abbey acknowledged the agency's role in providing objective data and analysis related to data center energy use. Building on this, the EIA announced in early February 2024 that it would launch a voluntary pilot program to collect detailed energy consumption data from nearly 200 companies operating data centers in Texas, Washington, and Virginia. The pilot will gather information on electricity consumption, energy sources, site characteristics, server metrics, and cooling systems used by these facilities.
While Senators Warren and Hawley praised this pilot initiative, their letter to the EIA also raised important questions about the agency's plans for broader data collection efforts. They asked whether participation in future energy surveys would become mandatory and whether the EIA intends to track behind-the-meter power generation. The senators stressed that this information is essential to ensure that large technology companies who pledged at the White House to cover their data centers' power costs will follow through on those commitments, preventing consumers from absorbing the expenses.
"Without this data, policymakers, utility companies, and local communities are operating in the dark," the senators wrote, underscoring the urgency of transparent reporting.
Currently, the EIA requires other sectors, such as oil and gas and manufacturing, to regularly report energy use data. Senators Hawley and Warren argue that data centers should be subject to similar reporting requirements under existing provisions that broadly cover energy consumption reporting. Legal experts like Peskoe believe the agency has the authority to mandate such disclosures from data centers.
The letter from Warren and Hawley comes amid growing concern at both the federal and state levels about the environmental and economic effects of data center expansion. On the same day the letter was sent, Senator Bernie Sanders introduced legislation proposing a nationwide moratorium on new data center construction and development until laws addressing artificial intelligence safety are enacted. Meanwhile, Democratic Senator Dick Durbin introduced a bill requiring data centers to disclose their energy and water usage publicly.
Across the country, state legislatures have introduced hundreds of bills related to data center regulation. At least a dozen states are currently considering halting new data center construction altogether, reflecting mounting pressure to address the sector's rapid growth and its impact on energy infrastructure and costs.
In summary, Senators Warren and Hawley's joint appeal to the Energy Information Administration highlights the pressing need for transparent, comprehensive data on energy use by data centers. Such information is vital for grid planning, consumer protection, and informed policymaking, especially as data centers continue to proliferate across the country and raise concerns about their effect on electricity prices and environmental resources. The ongoing legislative and regulatory attention at multiple levels of government signals a growing recognition of the importance of managing data center energy consumption in a way that balances technological advancement with consumer and environmental interests.